New Caledonia races to avert shutdown as new government takes office
Elected by New Caledonia's Congress last Friday following the 28 June provincial elections, the new government had until now been restricted to managing day-to-day affairs.
It must work to stabilise the finances of the South Pacific territory, which is struggling with the aftermath of the May 2024 riots that left 14 people dead and caused more than €2 billion in damage.
“We are in a state of cessation of payments,” government president Milakulo Tukumuli told reporters on Wednesday. “We need around 13 billion [Pacific] francs – that's €109 million – which we do not have.”
Without additional financing by the end of August, Tukumuli warned that the local administration could face a “complete shutdown”.
He leads Oceanian Awakening – L'Eveil Océanien – which brings together his small centrist party and other non-independence groups. Oceanian Awakening (L'Eveil Oceanien) party leader Milakulo Tukumuli looks on during the elections for the forming of the 17th government of New Caledonia, in Noumea, on February 17, 2021
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Paris holds key to emergency funding
A meeting was held on Tuesday between the New Caledonian government and the French state, represented by the Interministerial Mission for New Caledonia (MINC), in an effort to mobilise funds earmarked under the “refoundation pact” launched in March.
According to MINC director Amaury Decludt, around €432 million has been budgeted for 2026, of which some €141 million has already been disbursed.
“That leaves a significant margin,” he told French news agency AFP, noting that the remainder could be made available through state-guaranteed loans or grants. Amaury Decludt, director of the Inter Ministerial Commission for New Caledonia, appointed 13 April 2026.
However, the release of the funds remains conditional on the implementation of “credible reforms” aimed at reducing the deficit and enabling the territory to regain financial autonomy by 2030.
“Today, the [French] state is the only financier of New Caledonia,” Decludt said, adding that commercial banks and financial markets were no longer lending to the territory because of a loss of confidence.
He stressed that Paris did not intend to dictate the content of the reforms to New Caledonia's institutions.
“We have no signal today that would lead us to lack confidence in the government,” he said, noting that Congress had given the new executive a clear mandate to carry out reforms.
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Tukumuli said a cross-party delegation of elected representatives would travel to Paris before the end of August to press for the rapid release of the funds.
In New Caledonia's 19th government, Tukumuli retains responsibility for external relations and civil security, while also taking charge of transport, health and social protection.
Loyalist vice-president Christopher Gygès will oversee the economy, taxation, telecommunications and customs.
Alcide Ponga, president of the previous government and also from the non-independence camp, has been assigned responsibility for mining and energy – two key sectors of the New Caledonian economy.